A trust is an agreement where you transfer your assets for the benefit of yourself, then your loved ones upon your passing. It usually has a creator (yourself), trustee (usually yourself then whomever you choose after you) and beneficiaries (again yourself then your loved ones).
What Benefits Does A Trust Offer? Are There Any Disadvantages?
The main benefit of a trust is avoidance of court involvement in the event of your incapacity or death. It is a privately administered process unlike probate. There are really no disadvantages other than it may take a little effort retitling your assets into the name of your trust but otherwise it is a good option for most clients.
Can I Have More Than One Trust?
Yes but, other than for advanced estate planning purposes, it is unlikely you will need more than one trust.
How Would You Advise Someone Who Is Afraid Of Losing Control Over Their Assets?
In reference to a trust, you have not lost any control over your assets by transferring your assets to your trust. By transferring your assets to a trust, you are still the sole beneficiary and sole manager (trustee) of your trust. There is no loss of control or benefit of your assets.
Does A Trust Always Have Assets In It?
For typical revocable trusts used for estate planning purposes it serves no purpose to create a trust without assets eventually put into it.
Are Assets Held In A Trust Protected From Creditors?
For standard revocable trusts, there is no asset protection whatsoever. There are some advanced irrevocable trusts that provide some asset protection but it is outside the scope of most individual estate plans.
Why Would You Recommend A Trust As A Basic Strategy For Estate Planning?
We would recommend a trust over a Will for a basic estate plan because of its ease of creation, use and eventual administration. The other major benefit is that it’s a private, non-court involved, administration process.
Is A Will Just As Good As A Trust? Why Or Why Not?
Both documents work well to transfer your estate to your loved ones upon your passing but a will, by its nature, usually requires probate. Probate is a court procedure most clients would prefer to avoid.
How Can A Trust Avoid Probate?
If all your assets are transferred to your trust, then upon your passing, there are no assets left in your individual name. This therefore makes probate unnecessary. Probate on the other hand is the court ‘supervised’ process to transfer your assets out of your name to your heirs. We will add that probate is necessary whether you have a will or do not have a will. If there are assets in your name after you pass, probate typically will be required.
What Happens To A Trust Upon The Death Of It’s Maker?
This is when the benefit of the trust starts. Your appointed trustee can immediately start gathering the assets, paying off any debts, then make the distributions to the eventual beneficiaries all without court involvement and privately administered between the parties involved.
After the administration is complete, and the assets have been transferred to the trust maker’s beneficiaries, a trust automatically stops functioning and ceases to be operational or functional.
What Is Involved In Trust Administration? Is It Similar To Probate?
The process is similar in that the assets are gathered, debts are paid then distribution is made to the heirs or beneficiaries. Where it is different is that probate requires court supervision where trust administration is private. Trust administration tends to be less litigious since probate provides an open court procedure to bring a complaint and trust administrations, being private, do not. This does not mean a beneficiary of a trust cannot bring a complaint in the event of wrong doing, but trust administration is not as conducive to litigation as probate can be.
Can Someone Realistically Handle Trust Administration Without An Attorney?
For simple trust administrations, yes, which is one of the benefits of a trust.
For more information on Trust Administration In Arizona, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (480) 345-0444 today.
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